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Superior in what sense? When you invest in a fund with liquidity constraints you get paid in higher returns (an "illiquidity premium"). This was known by inv
by Ntrails 10y ago
Superior in what sense? When you invest in a fund with liquidity constraints you get paid in higher returns (an "illiquidity premium"). This was known by investors going in.
ETFs don't just magically make everything liquid without costs
- eru 10y agoExactly. The ETFs just make the liquidity issues public on the market. For the fund, you'd be paying some managers to buy and sell stuff whenever enough people/money leaves or enters the fund.